Solar and Battery Households Boost Grid Efficiency During Peak Times
With over 360,000 home batteries installed through the federal government’s rebate scheme, new data is shedding light on the benefits these systems bring to the electricity grid, despite criticisms that the initiative favours the affluent.
The Australian Energy Market Operator’s latest Quarterly Energy Dynamics report reveals that during the summer months, households equipped with solar panels and batteries have effectively absorbed excess solar energy during midday and have contributed to exports during evening peak periods.
Benefits of Battery-Equipped Households
This intervention has proved advantageous in addressing two principal challenges faced by the market operator: managing declining grid demand during daytime and ensuring adequate supply for the high demand in the evenings. Consequently, this has resulted in more stable energy prices, particularly in the evening hours.
Notably, AEMO provided examples from New South Wales and Victoria, with the latter case coinciding with a record high for electricity demand during a heatwave in late January.
AEMO noted, “In both instances, households with storage batteries transitioned to exporting in the late morning, displaying increased grid imports. This behaviour aligns with batteries utilising a combination of rooftop solar and grid electricity, leading to elevated operational demand in the mid-morning.”
During peak evening hours (from 4pm to 9pm), households with solar and battery installations continued to export energy to the grid for extended periods, significantly reducing their net grid imports compared to homes with solar alone, as the batteries discharged energy to meet household needs and support the grid.
In New South Wales, this translated to a decrease in average evening net imports of approximately 0.9 kilowatts (kW) per household compared to solar-only homes throughout the quarter, effectively smoothing out demand influenced by weather patterns. In Victoria, households with batteries experienced a reduction of about 1.4 kW in average evening peak net imports on the day of maximum demand.
Market Dynamics Shifting
Energy specialists view these developments as confirmation that the programme is functioning as intended. The large-scale batteries also contribute to moderating evening prices by displacing higher-cost hydroelectric and gas generation sources.
Additionally, the support offered during the midday hours helps mitigate minimum demand challenges, minimising instances when wholesale prices fall below zero, and optimising market signals for large-scale wind and solar projects.
This positive trend is observed not only in Australia’s main grid but also in the South-West Interconnected System (SWIS) that serves Western Australia.
Hamish McKenzie, deputy director of the climate and energy programme at the Grattan Institute, remarked, “Across both grids, batteries are harnessing inexpensive daytime energy and delivering it back to the grid at night, displacing pricier hydro and gas, which has a deflationary effect on prices.”
He added that this process is slightly increasing daytime prices, an indicator of the market operating as intended, thereby smoothing out both supply and demand and stabilising prices. The ongoing transformation facilitated by batteries is evident across both coasts, yielding significant repercussions for gas providers.
As we look ahead to the upcoming winter, there is keen interest in how much load batteries can handle, their depletion rates, and the frequency at which gas must step in to meet demand. Current circumstances are less predictable with a considerable increase in operational batteries since last winter.
Federal Minister for Climate and Energy, Chris Bowen, expressed satisfaction with these developments. “With Australia’s abundant solar and wind resources, we are leveraging our sovereign renewable energy to protect our grid from global energy fluctuations and reduce energy bills,” he stated in a recent announcement.
“The impact of the Cheaper Home Battery revolution is clear—over 350,000 household batteries are replacing gas at night with affordable solar energy, benefitting the grid overall.”
Bowen also pointed out that the previous government’s strategy appears regressive, aiming to halt renewable progress, rely on coal, and pass the costs of global volatility onto Australians.
While acknowledging that energy bills remain too high, he pointed out that the recent quarter indicates steady advancements in improving the situation.
